Tried it,
did it wrong
You may have seen liberals gleefully bringing up Kansas a lot lately. Under conservative Republican Gov. Sam Brownback, Kansas slashed tax rates – especially income and corporate taxes. Brownback repeated the theory made by supply-side economists and conservative politicians for years: that cutting taxes would spur economic growth and actually raise revenue in the end. That didn’t happen in Kansas, and so moderate Republicans – unwilling to make the necessary cuts in spending – recently reversed much of Brownback’s tax reform. Liberals are taking this as evidence that the supply-side argument that lowering taxes will lead to more revenue is bogus – and they may have a point.
Unfortunately for Democrats, while the failure of Brownback’s policies may be an indictment of supply-side economics, it’s not really an effective argument against tax cuts or small government. Instead, it reinforces what many fiscal conservatives have long believed: that you can’t cut taxes without cutting spending. If you poll Americans, most of them will love the idea of lowering their own taxes but hate the idea of cutting government services they use. It should come as no surprise that the idea of not having to worry about your bills is appealing to everyone. That’s why lottery tickets sell.
These two competing ideas are a huge driver of American politics. Indeed, they form much of the basis for our two-party system: Republicans want to cut taxes, while Democrats want to increase spending. The problem is that neither of them really want to pay for their plans, so they both came up with magic wands to wave away their problems. Democrats came up with the magic wand of raising taxes just on the rich to pay for things, while Republicans discovered the magic wand of supply-side economics. Of course, neither solution is indefinitely sustainable long-term – especially when taken to the extreme, as Kansas did.
The simple truth is that if you want to pay lower taxes, you’re going to have to cut spending to do it. You can’t just hope more money will materialize out of thin air, nor can you entirely move the burden to out-of-staters with tax shifts. It’s high time that Republican politicians ditch complex tax schemes and get back to the basics: to lower taxes, we’re going to have to cut spending, and it’ll include popular programs that a lot of people use.
There are some politicians who have always recognized these basic fiscal facts. Former Sen. Olympia Snowe, who was viciously attacked by many conservatives for opposing Bush’s tax cuts, was always cognizant of this. She didn’t want to limit the size of Bush’s tax cuts because she loved taxes, or wanter bigger government, but because she was worried about the federal budget deficit. That wasn’t some newly discovered concern of Snowe’s at the time, either. She consistently supported a balanced budget amendment to the U.S. Constitution (as has Susan Collins), long considered a holy grail for fiscal conservatives. Snowe’s focus on true fiscal responsibility, rather than the mere facade of it, often put her at odds with Republican leaders who wanted to do the popular thing rather than the right thing.
If you’re going to pass tax cuts, they ought to be paid for with specific spending cuts and spread out across the board to individuals, not targeted to the wealthy or to corporations. Any taxpayer, not just the rich ones, will spend more money if they have more money to spend; they’ll just spend it on different things. That will stimulate the economy, though maybe not in a splashy enough way that a politician can claim credit for it to get re-elected.
The repeal of Brownback’s tax cuts was certainly a blow to his legacy, but it shouldn’t be one to fiscal conservatives in general. Instead, it should encourage fiscal conservatives across the country to return to our roots, with a renewed focus on cutting spending, cutting taxes and reducing the deficit. It’s easy to promise to give people their money back without cutting spending, or by cutting only things that most people don’t like. Making real proposals to cut spending is a bit tougher.
It’s no coincidence that Rand Paul was the only presidential candidate with an actual budget proposal, or that Democrats endlessly attacked Mitt Romney over Paul Ryan’s budget. However, voters often reward candidates who are bold and honest. Rather than causing fiscal conservatives to doubt our goals, the results in Kansas should lead us to rethink our approach and redouble our efforts.
Jim Fossel, a conservative activist from Gardiner, worked for Sen. Susan Collins. He can be contacted at:
Twitter: jimfossel
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